July 7, 2010

In This Issue:

• Health Reform 2011: Wellness Grants for Small Employers
• Association Member Webinar August 18th at 10am
• Key Provisions of Health Reform 2014
• Quotable Moment

Printable Archive:

Health Reform 2011: Wellness Grants for Small Employers

Employers with fewer than 100 employees who work 25 or more hours per week and who did not have a workplace wellness program as of March 23, 2010, will be eligible for grants to provide comprehensive workplace wellness programs for their employees. Two hundred million dollars is authorized to be appropriated for the period of fiscal years 2011 through 2015 to fund the grants.

Eligible employers must make available to all employees a comprehensive workplace wellness program that includes:

• Health awareness initiatives (including health education, preventive screenings, and health risk assessments)
• Efforts to maximize employee engagement (including mechanisms to encourage employee participation)
• Initiatives to change unhealthful behaviors and lifestyle choices (including counseling, seminars, online programs, and self-help materials)
• Supportive environment efforts (including workplace policies to encourage healthful lifestyles, healthy eating, increased physical activity, and improved mental health)

An eligible employer that wants to participate in the grant program will have to submit an application to the Department of Health and Human Services (HHS).

Wellness Incentives
Effective for plan years beginning on or after January 1, 2014, employers may offer employees rewards of up to 30 percent of the cost of coverage for participating in a wellness program and meeting certain health-related standards. A reward may be in the form of a discount or rebate of a premium or cost-sharing mechanism (such as deductibles, copayments, or coinsurance), the absence of a surcharge, or the value of a benefit that would otherwise not be provided under the plan. Be sure to register for the next Association Member Webinar to learn how BCBSM and BCN can contribute to your company's wellness program.

Association Member Webinar

Association Benefits wants to assist you in finding solutions that will improve your company's bottom line through healthcare. A healthy workforce can result in cost savings for your business through improved attendance, productivity and work quality.

On Wednesday, August 18th at 10am, we will be hosting a FREE 30 minute webinar that will assist you in communicating wellness opportunities to your employees. This webinar will discuss preventive measures regarding weight and smoking.

What You'll Need and How to Register
You will need a computer or laptop with internet access for the web portion and a telephone to access the audio portion.

To register, just give us a call at Association Benefits, 248.356.3366 or 800.782.0712 and ask for Sherrian. Have your email address ready and we will send you the weblink and other information you will need to access the webinar.

Just another way Association Benefits is bringing you solutions at their finest!

Key Provisions for Health Reform 2014

Insurance Exchanges for Individuals and Small Businesses

By 2014, state-based American Health Benefit Exchanges and Small Business Health Options Program (SHOP) Exchanges, administered by a governmental agency or nonprofit organization, are to be operating so that individuals and small employers can purchase qualified coverage.

Small Employer.This term means an employer that employed an average of at least 1, but not more than 100, employees on business days during the preceding calendar year and that employs at least 1 employee on the first day of the plan year. For plan years beginning before January 1, 2016, a state may elect to define a small employer as employing not more than 50 employees. In the case of an employer that was not in existence throughout the preceding calendar year, the determination of whether such employer is a small or large employer is based on the average number of employees that it is reasonably expected to employ on business days in the current calendar year.

Qualified Employer.The term ‘‘qualified employer’’ means a small employer that elects to make all of its full-time employees eligible for one or more qualified health plans offered in the small group market through an Exchange that offers qualified health plans. A qualified employer may select any level of coverage to be made available to employees through an Exchange, and employees of a qualified employer may then choose to enroll in such a plan.

Snapshot: Impact Of Health Care Reform In Michigan Had It Been In Place In 2007/2008^*
According to a report published June 2010 by The Center for Healthcare Research & Transformation, in 2008 small businesses made up 78.5% of Michigan's private businesses and about 37% of all private sector employees. Of those small businesses, 54.7% of them did not offer health insurance. 33.2% of Michigan residents worked for small businesses that did not offer health insurance.

In 2007/2008, there were about 684,900 individuals who purchased individual health insurance in Michigan. Additionally, there were 363,020 individuals who were uninsured but would become subsidy eligible under health care reform to purchase coverage through the exchange. Another 95,882 who would not be subsidy eligible would be mandated to purchase coverage. So, it is likely that the individual insurance exchange could include a total of 1,143,802 individuals had it been in place in 2007/2008.

*Source: Issue Brief: The Impact of Health Reform on Michigan (June 2010). Center for Healthcare Research & Transformation. www.chrt.org

The Employer Mandate

The Patient Protection Affordable Care Act (PPACA) does not require employers to provide healthcare insurance for their employees. Instead, it imposes penalties on those that do not. Beginning in 2014, applicable large employers must decide if they want to provide minimum essential coverage under an eligible employer-sponsored plan or pay a variety of fines.

Applicable Large Employers.This term means, for a calendar year, an employer that employed an average of at least 50 full-time employees on business days during the preceding calendar year. An employer will not be considered to employ more than 50 full-time employees if the employer’s workforce exceeds 50 full-time employees for more than 120 days during the calendar year, and the employees in excess of 50 are seasonal workers. A “full-time employee” for this purpose is defined as an employee who is employed for an average of 30 hours per week during a month.

The term “seasonal worker” means a worker who performs labor or services on a seasonal basis as defined by the Department of Labor (DOL), including migrant agricultural workers and retail workers employed exclusively during holiday seasons.

All businesses treated as a single employer by IRC Sec. 414 are treated as one employer for this purpose also. IRC Sec. 414 is the frequently used rule for determining when related businesses should be treated as a single employer (for example when determining if an employer qualifies for the small employer exemption from COBRA).

If an employer was not in existence throughout the preceding calendar year, the determination of whether the employer is an applicable large employer is based on the average number of employees that it is reasonably expected to employ on business days in the current calendar year.

Solely for purposes of determining whether an employer is an applicable large employer, an employer must include in the count of full-time employees for any month the number of full-time equivalent employees it has. This number is determined by dividing the aggregate number of hours of service of employees who are not full-time employees for the month by 120.

The IRS, in consultation with the DOL, is to issue any necessary regulations, rules, and guidance for determining the hours of service of an employee, including rules for employees who are not compensated on an hourly basis.

Fines
Applicable large employer does not offer the minimum essential coverage.. For any month that an applicable large employer does not offer the minimum essential coverage and has at least one full-time employee who uses financial assistance to obtain healthcare coverage, the employer will be assessed a fee of $2,000 per each full-time employee. The first 30 employees are not counted when assessing the fee.

Applicable large employer does offer the minimum essential coverage.An applicable large employer that offers the minimum essential coverage but has at least one full-time employee receiving financial assistance to pay for coverage will be assessed the greater of $3,000 for each employee receiving assistance or $2,000 for each full-time employee. Employers that offer coverage will be required to provide a voucher to employees with incomes below 400 percent of the poverty level if their share of the premium cost is between 8 percent and 9.8 percent of income to enable them to enroll in an Exchange plan. NOTE: Employers that provide vouchers will not be subject to the penalty.

Quotable Moment

Thank you for your continued association participation.

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